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Volume growth remains intact

Total volumes grew 7.0% YoY to 4.8mmscmd (PLe: 4.8mmscmd), driven by healthy CNG/PNG-Dom volume growth of ~9.7%/9.1% YoY, partly offset by 7.2% YoY decline in PNG-I/C volumes. Benefits of price hikes, coupled with minimal Brent-linked gas sourcing, led to an Adj. EBITDA beat at INR3.4bn (PLe: INR2.4bn; BBGe: INR2.6bn). As a result, EBITDA/scm came in at INR7.9/scm (PLe: INR5.5/scm) vs Rs6.2/scm in Q4FY26 and INR9.6/scm in Q1FY26. Management increased FY27 capex guidance to INR18bn from INR12bn to accelerate infrastructure expansion for PNG-Dom growth opportunity and investment towards CBG plant. We build in volume growth of 8.0%/11.2% in FY27/FY28E (earlier - 8.6%/10.6%) to reflect lower PNG-I/C volumes in FY27E. We estimate EBITDA/scm of Rs8.0/Rs8.4 for FY27/FY28E. Maintain "Accumulate" with a revised TP of INR1,254 (previous: INR1,283), based on 12x FY28E EPS, reflecting higher interest costs as we factor in incremental debt to support the increased capex.

Volume growth remains resilient:

Total volumes grew 2.0%/7.0% QoQ/YoY to 4.8mmscmd, in line with our estimate, led by growth in CNG & PNG-Dom volumes, partly offset by weaker PNG-I/C volumes. CNG volumes grew 4.4%/9.7% QoQ/YoY to 3.5mmscmd, due to sustained underlying demand. PNG-Dom volumes rose 3.0%/9.1% QoQ/YoY to 0.6mmscmd, reflecting increased household conversions from LPG to PNG. However, PNG-I/C declined 9.9% QoQ, remaining flat YoY as the GoI curtailed domestic gas allocation to 80% of average consumption due to supply constraints from the disruption of West Asia

EBITDA/scm improves QoQ 

Blended realizations improved to INR54.7/scm in Q1FY27 (vs INR48.8/48.6/scm in Q4FY26/Q1FY26), driven by higher volumes and cumulative retail price hikes of INR5/kg in CNG and INR1/scm in PNG-Dom in Q1FY27. Consequently, revenue came in above estimates at INR23.7bn (PLe: INR22.1bn; BBGe: INR22.4bn), up 15.6% QoQ and 13.9% YoY. While gas cost rose to INR39.9/scm (vs INR35.2/32.3/scm) due to higher sourcing costs, gross profit/scm improved QoQ to INR14.7 (vs INR13.6), though it remained below INR16.3 in Q1FY26. Lower opex of INR5.8/scm (-9.2% QoQ, flat YoY) further supported EBITDA/scm, which increased to INR7.9 from INR6.2 in Q4FY26.

EBITDA and PAT outperformed cons SA EBITDA came in above estimates at Rs3.4bn, up 31.7% QoQ but declined 11.6% YoY (PLe: Rs2.4bn; BBGe: Rs2.6bn). Adj.PAT grew 46.8% QoQ but declined 18.0% YoY to Rs1.9bn (PLe: Rs1.2bn; BBGe: Rs1.3bn)

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